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Insurance fraud topped £1 billion in 2012

The value of fraudulent insurance claims made in 2012 reached £1.1 billion, according to figures from the Association of British Insurers (ABI).

The ABI found that the equivalent of 2,390 fraudulent or exaggerated claims worth £21 million pounds was made every week. It is the first time that the annual figure has exceeded £1 billion.

The ABI's figures revealed:

  • home insurance frauds were the most common: 51,000 worth £95.5 million were detected
  • dishonest motor insurance claims were the most costly: savings of £614 million were made from 42,700 dishonest claims
  • the value of frauds uncovered nearly doubled between 2007 and 2012
  • the number of frauds detected increased by more than a third in the same period.

Director of general insurance at the ABI, Nick Starling, said:

"There will be no let-up in the industry's zero-tolerance approach to insurance fraud. Honest customers rightly expect nothing less. Never has it been harder to get away with insurance fraud, never have the penalties - such as getting a criminal record and being unable to get future insurance and other financial products - been tougher."

Research commissioned by price comparison website Gocompare.com found that, even if they weren't badly hurt, six per cent of UK motorists would think about making a personal injury claim after an accident.

Of the motorists surveyed by the Gocompare.com research:

  • 66 per cent feel that claims for minor injuries are pushing up the costs of insurance
  • 63 per cent said that people should only claim for an injury if it caused them to miss work or directly affected their life
  • Four per cent said that people should do whatever they can to get money out of insurers.

Gocompare.com's head of motor services, Scott Kelly, said:

"It's unfortunate that both the ABI and our findings suggest that not only is there somewhat of a growing compensation culture in Britain, but also that there are a small minority of people committing deliberate fraud."

In December 2012, a whitepaper from the Ministry of Justice described Britain as the "whiplash capital of the world". It claimed that, between 2006 and 2012, there was a 60 per cent rise in claims for personal injury caused by road traffic accidents despite a 20 per cent fall in the number of reported accidents over the same period.